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EXHIBIT 2.2.1
FIRST AMENDMENT TO AMENDED AND RESTATED STOCK PURCHASE
AGREEMENT AND AGREEMENT REGARDING EARNOUT AMOUNTS FOR BONUS
YEAR 2004 AND INDEMNIFICATION CLAIM
This FIRST
AMENDMENT TO AMENDED AND RESTATED STOCK PURCHASE AGREEMENT AND
AGREEMENT REGARDING EARNOUT AMOUNTS FOR
BONUS YEAR 2004 AND INDEMNIFICATION
CLAIM (the "First Amendment") is entered
into as of November 10, 2004 by and
among Delta Apparel, Inc., a Georgia
corporation ("Delta"), M. J. Soffe Co., a
North Carolina corporation (the "Company"),
and James F. Soffe, John D. Soffe,
and Anthony M. Cimaglia (collectively, the
"Shareholders").
WHEREAS,
Delta, the Company, and the Shareholders entered into that
certain Amended and Restated Stock Purchase
Agreement (the "Stock Purchase
Agreement"), dated as of October 3, 2003,
pursuant to which the Shareholders
agreed to sell, and Delta agreed to
purchase (through a wholly-owned subsidiary
of Delta), all of the outstanding shares of
capital stock of M.J. Soffe Co.; and
WHEREAS,
Delta, the Company, and the Shareholders desire to amend the
definition of EBITDA contained in the Stock
Purchase Agreement and to make an
adjustment to the EBITDA calculation with
respect to Bonus Year 2004 (as such
term is defined in the Stock Purchase
Agreement); and
WHEREAS,
Delta, the Company, and the Shareholders desire to resolve
Delta's claim for indemnification by the
Shareholders with respect to the
understatement of current accrued
liabilities set forth on the Closing Financial
Information (as such term is defined in the
Stock Purchase Agreement); and
WHEREAS,
capitalized terms used herein, unless otherwise defined herein,
shall have the same meanings as given such
terms in the Stock Purchase
Agreement;
NOW,
THEREFORE, in consideration of the mutual covenants and
conditions
set forth herein, and other good and
valuable consideration, the receipt and
sufficiency of which are hereby
acknowledged, Delta, the Company, and the
Shareholders hereby agree as follows:
1.
The
definition of "EBITDA" contained in Exhibit L to the Stock
Purchase Agreement is hereby deleted in its
entirety and replaced with the
following, effective as of October 3,
2003:
"EBITDA
means the earnings of the Company (including income received in
the
Ordinary Course of Business from sources other than sales of
inventory)
before interest expense and income Taxes, plus depreciation and
amortization (including the addition of depreciation expense that
is
capitalized in inventory owned by the Company on the Closing Date
and sold
by the
Company during the applicable
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period,
but not including any depreciation expense that is capitalized
in
any other
inventory), determined in accordance with GAAP consistently
applied
and using methodologies that are consistent with those used on
the
Company's
opening balance sheet (which opening balance sheet shall be
prepared
in accordance with the methodologies set forth on Schedule X
attached
hereto and made a part hereof)."
2.
Delta
hereby agrees that EBITDA with respect to Bonus Year 2004
shall be increased (from the amount it
otherwise would have been) by the amount
of $26,000 for purposes of calculating the
EBITDA Earnout Amount and the Return
Rate Earnout Amount with respect to Bonus
Year 2004 (together, the "2004 Earnout
Amounts").
3.
The
Shareholders acknowledge and agree that the current accrued
liabilities of M.J. Soffe Co. at Closing,
as reflected in the Closing Financial
Information, were understated by an amount
equal to $1,541,090, as further
described in Exhibit A attached hereto, and
that such understatement constituted
a breach by the Shareholders of Section
8.11 of the Stock Purchase Agreement
(the "Breach"). The Shareholders further
acknowledge and agree that, pursuant to
the terms of the Stock Purchase Agreement,
Delta is entitled to assert a Claim
for indemnification with respect to the
Breach in the amount of $1,541,090 (the
"Closing Financial Information Claim")
